by David Lender
Shane picked up the pace. He wanted to get to the conference room early. In time to have a minute with Stinky Bates, the head of Corporate Finance, and Charles Fitzgibbons, the head of the Mergers & Acquisitions Group. At 50 years old, Shane was still slim and athletic, and wore his clothes with the air of a man who had them custom made for him, because he did. He was tall, 6’4”, and loved the look of himself reflected in the glass of the conference rooms. Gucci loafers. Sharp creases, and although you couldn’t see them beneath his midnight-blue suit jacket, suspenders that matched his tie. All carried off with a practiced, devil-may-care attitude. His dark-brown hair was slicked back. His eyes were bloodshot, as they always were, like he’d stayed up too late the night before or had done too much cocaine. He smelled faintly of soap. No cologne.
He reached the door of the conference room, at the northwest corner of the building facing north on Park Avenue. Bates and Fitzgibbons were already there. He’d made sure that Buchannan made sure that they would be. “Morning,” he said without emotion. Fitzgibbons, the head of M&A, was on the phone and didn’t look up. Bates turned and nodded to Shane. Shane closed the door behind him and stood in the doorway, again seeing the room through his client’s eyes. The bright light of the day and the grandeur of Park Avenue skyscrapers gleamed in through the windows. The room was a continuation of the seductive opulence of the rest of the place. The polished antique conference table and Chippendale chairs reeked of money. Old World, New World, definitely not nouveau riche money. But better-than-you, some-son-in-law-from-Boston, money.
Shane strode across the room and stood in front of Fitzgibbons. He waved at him until Fitzgibbons put his hand over the receiver.
“Yeah?”
“I’d like a minute with the two of you before Stanley gets here.” Fitzgibbons nodded and then turned his back to Shane to finish his conversation. Shane crossed the room again to the console that was bedecked with danish, bagels and fruits, and poured himself a cup of coffee.
“How’s it going, Stinky?” Shane said with his back to Bates. Shane chuckled under his breath, guessing how Bates was reacting to the hated nickname. Fitzgibbons hung up the phone.
“Morning, Jack,” Fitzgibbons said. He leaned on one leg, pulling his jacket open with one hand and thrusting it into his pocket, posing like a window display in Paul Stuart. “I’m all yours,” he said. “How long you figure this will take?” He looked at his watch, then up at Shane again.
“Half hour for you guys, then I’ll stay with him from there.” He looked at each of them in turn. “Thanks for coming,” he added, half under his breath as if it hurt him to say it. “I’ll make this brief.” Shane sat down at the far end of the table. Fitzgibbons took a seat at the exact opposite end when he saw Shane do so.
“Stanley is the CEO of Kristos & Company, a chain of 160 regional stores in the northeast. Middle-end department stores, started in the 1950s by his father-in-law, Nikolas Christanapoulas. The old man built it up to its present size, then passed the reins about a year ago to the son-in-law, because he had turned seventy, wanted to retire and didn’t have any male heirs.” He looked at Bates, who still stood awkwardly leaning on one leg, and then at Fitzgibbons. He saw they understood. He took a long sip of his black coffee. “So Stanley decides he wants to make a big splash, and as you know, Charles, we’ve got him teed up to buy Milstein Brothers Stores, the fifty-store nationwide high-end department store chain. It’s about a $3 billion deal, worth roughly three times as much as Kristos & Company is worth.” About $15 million in fees for that piece, Shane thought, not permitting himself to do the exact calculation in deference to his superstition. “We do a $550 million IPO for Kristos & Company, which I presume you know all about, John,” he said toward Bates rather than to him, refusing to meet eyes with him, “and then a $1.5 billion high yield deal. The use of proceeds for the financings is to acquire Milstein Brothers, except for $50 million father-in-law’s taking off the table by selling some of his shares in the IPO.”
Shane looked at the other two, who nodded that they understood.
“You being taken care of with staffing on the M&A side?” Fitzgibbons said.
“I could use another pair of hands, you know that.”
“We’re a little tight right now, like we’ve been telling you. But we’re going to get a pack of new Associates in here pretty soon. Hang in there for a while, we’ll get you covered in a month or so,” Fitzgibbons said. Bates shifted his weight again.
“Okay, so that’s the story, which I presume both of you guys have read in the briefing books,” Shane said. He resisted the urge to scowl. He knew damn well these guys hadn’t read any of the materials he’d had prepared for either the M&A deal or the IPO. They probably skimmed a one- or two-page note prepared by some poor slob Associate or Vice President on their staffs. But that was it today in investment banking. Senior guys didn’t really know what was going on. They just popped into meetings to wave the flag to impress clients that the head of this or that gave a damn about their deal. Guys like Shane were a dying breed, bankers who did soup-to-nuts for their clients: conceived the deals, actually gave advice on strategy, and did the execution themselves. None of this specialist bullshit where a guy stepped in and did his two little pieces and then left. Well, they’d get him through this phase, because Stanley really wanted to see the head of M&A and the head of Corporate Finance to know the “experts” were paying attention to his deals.
“So we jawbone the guy for half an hour or so, and then you guys are free to go. Any questions?” They both shook their heads. Shane nodded and turned to pour himself another cup of coffee, then looked at his watch. Ten minutes, he thought. Fitzgibbons stood up and went back to the telephone.
“Stanley!” Shane said in his practiced, melodious baritone when an attractive blonde showed Stanley into the conference room. The blonde lowered her eyes demurely and pulled the door closed behind Stanley.
“Jack, always great to see you,” Stanley said in a Northeasternboarding-school voice, while pumping on Shane’s hand. Stanley was tall, blond and thin. He parted his hair in the middle and wore a correspondingly WASPy three-button suit. Shane smiled and extended an arm toward the center of the room. He made sure his brown eyes swam with goodwill.
“Thanks, Stanley, and you, too. And let me introduce my colleagues, John Bates, Managing Director and Head of all ABC’s Corporate Finance activities, and John Fitzgibbons, Managing Director and Head of ABC’s Mergers & Acquisitions Group.” Shane threw a look of collegial affection at each of his colleagues as he introduced them. They walked across the room to shake hands with Stanley, Bates with his jacket buttoned and Fitzgibbons with one hand still in his pocket, bright blue suspenders showing against an English striped shirt of yellow and blue, and a matching blue Gucci tie with the label splayed outward.
Coffee and breakfast was offered. Additional pleasantries were exchanged. They sat down around one end of the table with Stanley at the head and got down to business.
“Stanley, as I told you, I thought you might like to hear from the Department heads who would oversee your transactions, and whose teams would report in to me.” Shane gave Stanley another of his client smiles, then nodded to each of his colleagues. “Our objective for today is to give you the comfort that we can bring the resources to bear on your proposed deals, give you a sense of the commitment of the firm to Kristos & Company, and of course to you personally Stanley, and then we can handle some of the details on our engagement structure later, perhaps after lunch. We’ve got a dining room booked across the floor at 12:30. I’ll be introducing you to Steven Dick, the Chairman of our firm at that time. But for now, I thought it might make sense to let you hear from John and Charles, here, about what we see for the respective deals. Sound okay?” Shane said and opened his palms toward Stanley.
“Absolutely,” Stanley said and rested his folded hands on the table.
“Maybe I should speak first, since the M&A transaction on Milstein Brothers Stores
is the crux of the whole thing,” Fitzgibbons said. “As you know directly from your own meetings with the Milstein brothers, they are favorably disposed and we’re drafting the definitive purchase agreement right now. Through Jack’s good offices we know you’re being well taken care of, but you should also know that one of our other colleagues has the direct relationship with the Milstein brothers and he also says they’re delighted with the prospective transaction. Everything seems poised for a deal thanks to Jack, and I’ve got some of my best guys working with Jack and your attorneys at Winston & Sterling.”
Shane’s mind drifted off as Fitzgibbons went through his shtick. IPO and high-yield financing and M&A fees. Then there was the bank financing of about $1 billion. All-in about $90 million in fees, Shane thought. And after these guys get done salami-ing off whatever they can get their hands on, it should still about make my year. Let’s hope the markets hold up. He looked at Stanley. Shane noted the pinkish glow under his skin, a glow of vulnerability. And let’s hope you don’t get hit by a truck, dear Stanley. And that old man Nick decides not to step back in and change the game plan.
After Fitzgibbons was through, Bates did his part. Shane was actually impressed. Bates carried it off with style, relating the history of the growth of the 1,000-strong Investment Banking Group of Abercrombie, Wirth & Co., describing its downtown roots from a 50-person boutique firm specializing in corporate advisory to its current stature as the last privately owned of the elite Wall Street firms that dominated the underwriting, mergers and acquisitions, and capital markets businesses. “We’re considered the guys to watch, because we’re the ones with the momentum. And we’re having fun,” Bates said, smiling with sincerity, conveying a warmth that again surprised Shane. “We like our business, we enjoy our clients, and we’d be happy to count you among them.”
Afterward Shane walked Stanley back along the same route through which he had entered, then downstairs to the 42nd-floor trading room. The trading floor took up the entire 100,000-square-foot floor and was three stories high, extending up to the 45th floor. The effect was intoxicating, as always. Hundreds of shouting, gesturing and athletic young bodies, barking into telephones, hollering at each other, all banked in row upon row of high-tech Bloomberg and analytical trading screens stacked two and three high, blinking in multihued colors. The noise, the phones, the energy, all rose in a multitudinous din that said, “This is where it happens. This is where it is. The money.” Stanley seemed awestruck.
Over lunch he spilled his wine, which delighted Shane. Great, keep him off balance. Shane zeroed in on Stanley after that. By 2:00 p.m. he was in front of the building with Stanley to deposit him in a limo.
“Great day,” Stanley said, pumping Shane’s hand again. “We’ll have to do that golf game before the deal’s done.”
“Absolutely,” Shane said and closed the limo door. Golf, he thought as he headed back into the building, now there’s a dumbass game. Thousands of hours of practice to sit in a goofy little cart with a numbskull twit like Stanley for five hours. He’d rather get his fingers smashed in a car door. If Stanley’d said tennis, maybe. At least that was a man’s game. There you worked up a sweat, got a chance to pound out some aggressions, even smash the shit out of the ball down the other guy’s throat. Golf, my ass.
Five minutes later Shane sat with his feet up on his desk, an executed original of his engagement letter propped in his lap. “All right, Stanley, away we go,” he said aloud.
Excerpt from Bull Street
BULL
STREET
A WALL STREET NOVEL BY
DAVID LENDER
Copyright © 2011 by David T. Lender
All rights reserved. No part of this book may be used, reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage or retrieval system, without the written permission of the publisher, except where permitted by law, or in the case of brief quotations embodied in critical articles and reviews. For information, contact [email protected]
ONE
NEW YORK CITY. BEFORE THE global financial crisis.
“If I don’t have a job by April, I’m not getting one,” Richard said. “At least that’s the adage at B-school.”
“And this the Ides of March,” Dad said.
That ominous reference hit home. Richard’s guts rumbled.
Richard Blum and his dad, Hank, sat in a Greek diner in downtown Manhattan near Wall Street. It was two blocks from Walker & Company, Richard’s first interview of the day, and four blocks from Dad’s insurance convention. Richard played with the tag on his teabag, preoccupied; this five-day trip to New York was his last chance to salvage a job on Wall Street from an otherwise failed recruiting season. It was opportune that Dad and he could squeeze in breakfast together while Dad was in town from St. Paul at the same time for his convention. They sat at a booth across from the counter, leaning in toward each other so they could hear over the clink of china, barked orders, the clang of spatulas on the grill. Richard savored the clamor and aromas of the place. It had a casual comfort, a folksy smell of eggs and home fries Richard knew Dad must be enjoying. He eased up his cuff to check his watch.
“You getting concerned?” Dad asked.
“It’s never over until you call it quits, I guess, but in finance parlance I’m a wasting asset.”
“Not what I asked. You worried?”
“Sweating bullets.”
He looked at Dad’s clothes: cotton/polyester button-down, spot on his pin-dot tie, suit shiny from wear. He smiled; it made him comfortable, too, warmed him inside. He glanced down at his own clothes. He was wearing $3,500 in Polo Ralph Lauren. The topcoat he’d sprung for as part of this last-ditch effort to land the big one was dragging on the floor. A barometer for how it was going.
“You must be making progress, though.”
“I’ve struck out in all my on-campus investment banking interviews—the few I’ve gotten.”
Dad just nodded, taking it in, thinking. “Anything useful to you come of them?”
“Only that Michigan’s a second-tier school for the Wall Street firms. The entire recruiting season of interviews only netted all our MBAs twelve investment banking second-round callbacks on campus, four trips to New York, one offer.”
“That’s at least one.” Dad, trying to be positive. He smiled, then squinted and pursed his lips. “There must be others coming to campus.”
“No. It’s too late in the season for first rounds on campus.” Richard resisted the urge to squirm in his seat. “So that’s it for anything through the Placement Office.”
Dad winced. He looked down at his plate, hesitated, then back in Richard’s eyes. “Now this trip,” he said, continuing to eye him. Richard first thought Dad’s expression meant he realized this was Richard’s last gasp. Now he had an inkling maybe there was more to Dad’s look than that.
“Yeah, eleventh-hour effort. In New York to pound the pavement, follow up on cold letters attaching my resume. See if I can beat down some doors.”
Dad leaned back. “So how’s the trip going?” Richard felt him zeroing in, watching him.
“Four screening interviews, down to my last two.” Richard started twirling the tag from his teabag again, beginning to get anxious, knowing today’s interview was his only real chance.
“Remember A Mathematician’s Apology?” Dad said. His gaze was now locked in on Richard, intent. Richard swallowed.
“How could I forget? It’s been a big influence on me.”
It was the book Richard and Dad had both read as he headed to college. Richard was turning the corner from defiant teenager, starting to get close with Dad again, this time man-to-man. When Richard landed the job after college writing ad copy at McAlister & Flinn, still living at home, he and Dad developed a working relationship. Dad helped out as proofreader and critic. Richard learned Dad actually had business wisdom to impart; insurance was at least on the same hemisphere
as writing copy to convince people to buy steak sauce or annuities. Business became a common language and culture that kept them up late nights, talking about interest rates, the CPI. And eventually, over a scotch now and then, they discussed the novels of Elmore Leonard or Trollope, the music of Mozart and Beethoven. Richard thought back to A Mathematician’s Apology, said as if reciting, “Three kinds of people. The first, I do what I do because I have an unusual talent for it. The second, I do what I do because I do lots of things pretty well and this was as good a choice as any. And the third, I don’t do anything very well and I fell into this.”
“I’m a good fidelity bond underwriter, and I could’ve done a lot of other things probably just as well. What you’re going after is a world I don’t understand much about. But if you think you have it, go for it.” Still searching Richard’s face.
“Yeah. I can do this.” Telling himself, needing it for this interview.
“So don’t give up. But don’t compromise who you are and where you came from. Don’t let Wall Street turn your head.”
“Any other advice?”
“Well, since you ask,” Dad said, now giving him that halfsmile he wore when he launched a zinger but still wanted to show affection. “All I’ve heard is excuses. This isn’t like you. Get primal. Think like these Wall Street guys, like a caveman who needs to win over a woman or he can’t procreate. Put some oomph into it. You’re on your own; nobody can do it for you.”
They sat in silence a moment, Richard looking at the halfsmile still on Dad’s face. Dad was right. It’s all up to me.